How the Gold Market works, what’s changing and how to benefit

- Presented by Thomas Coughlin

Major Gold Markets

London - OTC Wholesale Market

• Spot, Forwards, Options & Swaps

• 90% Spot

COMEX - Exchange Traded Market

• Futures & Options

Loco London Gold Market

LBMA London Bullion Market

Association

Trade Association

Gold & Silver

Good Delivery List

Member List

Arrange Conferences

The Fix London Gold Fixing

Benchmark Price

Price Set Twice Daily

Five Members

LPMCL London Precious Metal

Clearing Limited

Unallocated Clearing

Vaulting

Six Members

BOE Bank of England

Allocated Clearing

Vaulting

Central Bank Custodian

Market Makers 1. ScotiaMocatta 2. Barclays Bank 3. Deutsche Bank 4. HSBC Bank 5. JP Morgan Chase 6. Goldman Sachs 7. Mitsui & Co 8. Societe Generale 9. UBS

Members 1. ScotiaMocatta 2. Barclays Bank 3. Deutsche Bank 4. HSBC Bank 5. Societe Generale

Members 1. ScotiaMocatta 2. Barclays Bank 3. Deutsche Bank 4. HSBC Bank 5. JP Morgan Chase 6. UBS

What’s Changing? A Global Repatriation & Hoarding

Total Gold Demand, 2009 Q1 and 2013 Q2. Gresham's Law:

"When a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation." "Bad money drives out good".

HOARDING!

What is the “Bad Money”?

Unallocated Paper Gold

35.06% 72.94%

Global Repatriation Hoarding

Global Repatriation

London COMEX

Partial Fungibility

EFP Exchange Futures for Physical

The Wholesale Market - Present Physical Flow of Gold

LONDON

U.K. Gold Shipments Climb Eightfold as Metal Seen Moving to Asia

- Bloomberg

UK gold exports surge tenfold this year - Financial Times

Gold flows from Britain to Switzerland surge

in H1-Macquarie - Reuters

797 tonnes exported from London in the first half

of this year.

An Estimated 10,000 tonnes total sits in London

At this rate all gold will have disappeared from London vaults in just over 6 years!

COMEX

A Proposed New Global Marketplace

A Global Loco Trading Hub Market with a Unified Vaulting Network for Allocated Bullion

One Global Market

London

Zurich

New York

Singapore

Hong Kong

Sydney

Dubai

Toronto

Market Price

•Global Price Flattened

•Perfect arbitrage between hubs.

Refiners, Mints & Vaults

•Worldwide

•America

•Europe

•Asia

•Africa

•Middle East

Delivery Mechanisms: •Worldwide

•COMEX

•TOCOM

•CGSE

•SFE

•DGCX

•SMX

Clearing Banks & Central Banks

•Worldwide - all time zones

•America

•Europe

•Asia

•Africa

•Middle East

Wholesale Market Comparison

- Presented by Thomas Coughlin

London Market Global Market London price Global market connecting local physical markets

Unallocated True global price + True local prices + Flattened Global Price

Effective unlimited supply - Part of fractional banking system Allocated – difficult to manipulate

Investor holds counterparty risk against custodian Finite supply – placing upward pressure on gold prices

Expensive transportation costs Investor holds legal title

Only trading and clearing during London time Negligible counterparty risk

Only wholesale lot sizes – Market not available to private investors Can store gold locally in home region

Organically dying market Minimal transportation costs

Organically evolving market

What is Bullion Capital Doing?

Bullion Capital Limited (BCL) offers a loco trading hub physical bullion market, with an online trading platform for precious metal traders and investors.

BCL – Similar to above proposal

ABX – Same as the above proposal

Australia Global Global

OTC Wholesale

Soon! Late 2014 – Early 2015 Live!

Affiliated

Are we mucking around?

Name Position

William Purpura Managing Director, Great Lakes Global Limited and Chairman of COMEX, Boards of Governors

Dale Zhu Deputy Head of Global Commodities, Bank of China International

David Govett Head of Precious Metals, Marex Spectron

Grant Williams Portfolio and Strategy Advisor, Vulpes Investment Management

Paul Burton Consultant to Hinde Capital

Ned Naylor-Leyland Investor Director and CSI, Cheviot Asset Management Limited

Michael Hadley Managing Director, John Galt Trading Consultants

Christopher Olson President and CEO, Treasure Island Coins Incorporated

ABX Advisory Committee

• We’ve spent three years collaborating with industry specialists. • We’ve liaised and done board room battle with over 500 bullion market participants from the top down. • We’ve internally developed the unique systems, mechanics and technology to bring this market together. • We’ve got brokers, dealers, platform providers and SMSF administrators already utilising the BCL platform. There is overwhelming support for this Global Market.

BCL Australian Market Offering

1) A Private Client Service – Closing Soon! 2) Introducing Broker Service Allocated Physical Bullion Stored in Australian vaults, not a paper contract. Withdraw your bullion at any time. Retain complete ownership and control over your investment. Unimaginable Security Locally stored and insured by Armaguard, verified by Inspectorate, audited by BDO. Simply the most secure physical bullion investment solution. Cost Effective With prices provided by multiple market participants, avoid dealer spreads and benefit from MetalDesk's exchange based trading platform.

Opportunity – How to Benefit • Sign up as a client or Introducing Broker and Support us with our mission of implementing this revolutionary new allocated

global bullion market and help pave the way of the future.

• Should we collectively succeed, there will be an abandoning of the current archaic London paper system and a conversion to

a highly efficient allocated system.

• This will place enormous upward pressure on the gold price and all precious metal investors will benefit.

• Further, simply enjoy all the other benefits BCL has to offer through highly efficient online exchange trading platform.